NEWS
Follow-Through Friday

A hotter-than-expected retail sales number and ‘hawkish’ comments by several Fed members had stock market bears on the offensive. The market closed lower for the fourth straight day, giving back some of its post-election gains in the process. 👀

Today's issue covers the Nasdaq 100’s “island reversal,” Palantir’s executives enjoying the bull market a bit too much, and more from the day. 📰

Here’s the S&P 500 heatmap. 3 of 11 sectors closed green, with utilities (+1.50%) leading and technology (-2.48%) lagging.

And here are the closing prices: 

Most bullish/bearish symbols on Stocktwits at the close: 📈 $CMP, $ERNA, $BE, $ABUS, $CYCN 📉 $IPG, $POOL, $TOI, $TWST, $PLTR*

*If you’re a business and want to access this data via our API, email us.

STOCKS
Late Buyers Left Stranded On An Island 🏝️ 

On Monday, we discussed how far many stocks were from their long-term trends using a common technical indicator, the 200-day moving average. We noted then that this often represents an elevated level of risk in the market, particularly when speculative assets like DogeCoin and other risky assets are seeing such strength. 💸 

Little did we know that Tuesday would mark the start of a stock pullback that has lasted straight through the end of the week. And some technical analysts are saying this selloff could just be starting because the Nasdaq 100 has formed an ominous “island reversal” reversal pattern.

Below is a longer-term chart of the Nasdaq 100 ETF ($QQQ) with a pic of the last week's worth of trading. As we can see in that box, prices gapped up, traded in a range for several days, and then gapped down. This price action traps buyers on an “island” and often forces them to exit their positions as their losses mount. 😨 

If this bearish reversal pattern holds (i.e., if prices don’t fill this gap), then technical analysts say the next logical level of long-term support is at the uptrend line from their 2023 lows and the 200-day moving average near 462. 🎯 

As for what sparked this selloff, it depends on who you ask. However, an easy thing to place blame on is October’s retail sales data, which showed that Americans stepped up spending last month. Retail sales rose 0.4% MoM in nominal terms, or 0.1% adjusted for inflation. 🛍️ 

Additionally, Boston Fed President Susan Collins raised further doubts about future rate cuts by saying December “isn’t a done deal.”

On top of that, the weakness in semiconductors we highlighted yesterday continued today, increasing its drag on the market and turning everyone’s attention back to Nvidia earnings, which are due Wednesday after the bell. 👀 

NVIDIA DAY COUNTDOWN
Your Chance To Win Exclusive Nvidia Merch 🤩

Think you know Nvidia stock better than the 546,846 other people following it on Stocktwits? Now’s the perfect chance to flex your muscles. 💪

Use our “Price Prediction” tool to forecast its Thursday opening price. The first person to predict it correctly will win exclusive, limited-edition $NVDA merch worth $120. And bragging rights, of course. 😉

And be sure to follow @Stocktwits on the platform and our socials (X, Instagram, YouTube) so you don’t miss out on all the Nvidia action before they report after the bell on Wednesday! 🚨